'Go to' clouds of the future, part 2

In part 1 of this two-part series, I highlighted my thoughts on why the long-term future of the cloud, at least for consumer and small business, belongs to integrated "one-stop" cloud suites, and why Microsoft and Google are the two companies best positioned for this opportunity. However, I was also clear that success in this space for both companies is far from guaranteed.

The truth is that several potential competitors could overtake either--or both--companies, if they should fail to execute successfully. Here are some of my favorites, and a few that should be contenders but really aren't, at this point:

Salesforce.com
With a series of moves in the last year or two, Salesforce.com has moved from simply being a customer relationship management software-as-a-service vendor to being a true cloud platform contender. With the broadening of its Force.com platform as a service environment to add Java (via VMforce, a partnership with VMware) and Ruby (via the acquisition of Heroku), Salesforce has made itself a very interesting option for developers.

However, given its SaaS roots, I'm convinced that CEO Mark Benioff has more up his sleeve than that. Already, Salesforce has built up an impressive ecosystem with its App Exchange marketplace, but the real sign that it intends to be a broad business platform is the investment in Chatter, its enterprise social network and collaboration tool.

With a few more acquisitions and/or product offerings to expand its business applications suite (perhaps adding e-mail, a productivity suite, or even accounting applications), Salesforce will begin to look like a true "one-stop" leader. Frankly, with respect to the company, I'm already on the fence about whether the top two should become the top three.

VMware
First, it should be noted that VMware is not trying to be a cloud provider itself but rather an arms dealer to those that are. The question is, will it help these providers be "one-stop shops," if they so choose?

There is no doubt that VMware has made significant progress in moving up the stack from virtual server infrastructure to cloud computing and even to development platforms. The aforementioned PaaS offering with Salesforce.com, VMforce, is one example, but there have been many announcements around cloud application development and operations capabilities--and all signs point to there being much more to come.

The reason VMware is mentioned here, however, is its acquisition early in 2010 of Zimbra, the open-source online e-mail platform. To me, that was a sign that VMware was looking at building a complete suite of cloud services, including IaaS, PaaS, and SaaS capabilities. However, as far as I can tell, the SaaS-related investments have either gone underground or dried up completely.

Giving VMware the benefit of the doubt, I'll assume that it is still working its way up to the SaaS applications necessary to supply one-stop cloud services. With the capabilities it has been working on over the last few years, being a contender in this space is not out of the question--or perhaps its ecosystem of partners will do it for the company. However, it just doesn't have enough SaaS to be one today.

Amazon Web Services
Amazon Web Services is, and will likely remain, the flagship cloud infrastructure company. It is also underrated as a PaaS offering, in that most people don't understand how much its services are geared toward the developer.

However, it is completely focused on selling basic services to enable people to develop, deploy, and operate applications at scale on its infrastructure. It does not appear to be interested today in adding SaaS services to serve small businesses.

That said, there are two things that may make AWS a major part of the one-stop ecosystem. The first is, if a start-up or existing SaaS provider chooses to build and operate its one-stop suite on top of AWS services. That is actually a very likely scenario.

The other would be if Amazon.com CEO Jeff Bezos sees an integrated suite of small-business applications as a perfect offering for the Amazon retail business. This would probably be the resale of other companies' software, but it would make AWS a one-stop shop worth paying attention to.

IBM and HP
IBM and Hewlett-Packard are companies that can integrate a wide variety of infrastructure, platform, and professional-services products, so you can never count them out of a major IT market opportunity. However, they seem to have shifted away from business software suites, with a focus more on IT operations and data management/analytics.

While IBM and HP will no doubt be players in enterprise IaaS and PaaS, I don't see them making the investments in building, acquiring, or partnering for the basic IT software services required to meet the one-stop vision. Again, perhaps their ecosystems get them there, but they are not promoting that vision themselves.

Hosting-turned-cloud companies
Companies such as Rackspace, Terremark, and other hosting companies that have embraced the cloud for IaaS services are important players in the overall cloud model, but I don't believe that they are ready to contend, when it comes to integrated cloud suites, at this time. Their focus right now is on how to generate as much revenue as possible per square foot of data center space, and their skill sets fit IaaS perfectly. However, if VMware or another cloud infrastructure software provider builds a suite of services that they can simply deploy and operate, that may change quickly. They just are not contenders based on today's business models.

Telecommunications and cable companies
One possible industry segment that may surprise us with respect to one-stop cloud services would be companies such as AT&T, Verizon Communications, Comcast, and BT--the major telecommunications providers. They own the connectivity to the data center, the campus, mobile devices, and so on, and they have data center infrastructures perfect for a heavily distributed market like the small-business market (where each small business may be local, but the market itself exists in every town and city).

The problem is the same as it has been for decades: business models and regulatory requirements of these companies make it difficult for them to address software services effectively. These companies have traditionally been late to new software market opportunities (with the possible exception of the mobile market). You don't see AT&T, for instance, competing with others in bidding for a platform-as-a-service opportunity. So until they show signs of understanding how to monitize business applications, they are not in the running.

My dark horse: Oracle
"Really? Not with Larry Ellison at the helm," some of you are probably thinking. However, you have to admit that when it comes to business software suites, Oracle certainly has the ammunition. It has dabbled in SaaS already, and with the Sun acquisition, it has rounded out its possible offerings with OpenOffice.org and Java.

Oracle's biggest problem is its business model, as well as its love of license and maintenance revenue. If it can figure out how to generate revenue from SaaS that meets or exceeds its existing model, I think that it'll move quickly to establish itself as a major player in the space and will quickly rise towards the top of the heap. In fact, the recent announcement of Oracle Cloud Office might be a sign that it has already started.

Today Oracle does not seem to be focused on being a cloud provider. It killed Sun's IaaS offering--which always confused me--and has only introduced PaaS for private-cloud deployments. To date, it seems that it can't pull itself away from equating an enterprise sale with an on-premise, up-front licensing sale.

I am watching Oracle's moves in the cloud with great interest, for that reason.

If I am right--if one-stop cloud services are what many small and midsize businesses turn to in order to avoid building an IT data center infrastructure of their own; if integration is the key differentiator for cloud services across SaaS, PaaS and IaaS--then I'm pretty comfortable with the observations I've made in this series.

If I am wrong, then integration of disparate cloud services will be a huge market opportunity. What it will come down to is what is easier to consume by small and medium-size businesses. For that reason, I'll place my bet on the one-stop model. What about you?